Three Rock Hill store owners have been indicted by federal prosecutors in connection with an alleged $5 million conspiracy to accept food stamps for the purchases of cigarettes, beer and gasoline.
In the June 21 federal grand jury indictments, court documents show, prosecutors allege that Li Fang Phu, Hoang Long Huu Nguyen, and Dianne Margaret Phu conspired in a scheme at the former Gas on the Spot store on South Cherry Road, and at the Daily Express Mart on Wilson Street just two blocks from the Rock Hill Police Department, to defraud the federal government of $5,850,733.
Food stamps, technically called the Supplemental Nutrition Assistance Program, are a federal program that gives assistance to the poor for food purchases only. Food stamps by law are not allowed to be used for non-food items.
Food stamps were converted from paper to EBT cards in 2002.
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Li Phu and Hoang Nguyen face charges of wire fraud for allegedly exchanging food stamps for cash. Diane Phu and the other two defendants are all charged with conspiracy in the alleged scheme.
Federal indictments allege the scheme involved accepting food stamps. Some of the purchases charged to food stamps were as high as $59 for a bottle of beer and a pack of cigarettes.
Allegations of fraud include repeated instances on certain dates, including at least four illegal deals on June 11, 2015, during which cash was taken from food stamp purchases.
The three store owners could be forced to forfeit any property or proceeds “derived from or traceable to” the alleged fraud, court documents show.
Although federal prosecutors did not include specifics in the indictments, the three suspects allegedly used signs, signals and other means to pull off the scheme. The charges carry up to five years in prison for each count, and potential fines.
All three are expected in federal court July 6, court records show.